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The Financial Literacy and Education Improvement Act created, in December 2003, the Financial Literacy and Education Commission. Responding to the act's mandate that GAO assess the Commission's effectiveness, this report reviews its progress in (1) developing a national strategy; (2) developing a Web site and hotline; and (3) coordinating federal efforts and promoting partnerships among the federal, state, local, nonprofit, and private sectors. To address these objectives, GAO analyzed Commission documents, interviewed financial literacy representatives, and benchmarked the national strategy against GAO's criteria for such strategies.

The National Strategy for Financial Literacy serves as a useful first step in focusing attention on financial literacy, but it is largely descriptive rather than strategic and lacks certain key characteristics that are desirable in a national strategy. The strategy provides a clear purpose, scope, and methodology and is comprehensive in identifying the breadth of issues involved and the challenges in addressing them. However, it does not serve as a plan of action designed to achieve specific goals, and its recommendations are presented as "calls to action" that generally are either descriptions of existing initiatives or broad pronouncements that do not include a specific implementation plan. The strategy also does not fully address some of the desirable characteristics of an effective national strategy that GAO has previously identified. For example, it does not set clear and specific goals or performance measures by which to benchmark progress, address the resources needed to accomplish these goals, or fully discuss appropriate roles, responsibilities, and accountability. As a result of these factors, most organizations that GAO spoke with said the strategy would not play a meaningful role in guiding or informing their efforts. The Commission's Web site and telephone hotline offer financial education information from numerous federal agencies. The Web site generally serves as an effective portal to existing federal financial literacy sites. Use of the site has been growing, and it averaged about 57,000 visits per month from May through September 2006. The volume of calls to the hotline--which serves as an order line for a free tool kit of federal publications--has been limited. The Commission has not tested the Web site for usability or measured customer satisfaction with it; these are recommended best practices for federal public Web sites. As a result, the Commission does not know if visitors are able to find the information they are looking for efficiently and effectively. The Commission has taken steps to coordinate the financial literacy efforts of federal agencies and has served as a useful focal point for federal activities. However, coordinating federal efforts has been challenging, in part because the Commission must achieve consensus among 20 federal agencies, each with its own viewpoints, programs, and constituencies, and because of the Commission's limited resources. A survey of overlap and duplication and a review of the effectiveness of federal activities relied largely on agencies' self-assessments rather than the independent review of a disinterested party. The Commission has taken steps to promote partnerships with the nonprofit and private sectors through various public meetings, outreach events, and other activities. The involvement of state, local, nonprofit, and private organizations is important in supporting and expanding Commission efforts to increase financial literacy. As the Commission continues to implement its strategy, it should consider expanding its activities and work to develop mutually beneficial and lasting partnerships that will be sustainable over the long term.

Recommendations for Executive Action

Status: Closed - Implemented

Comments: In its April 2008 update to the National Strategy for Financial Literacy, the Financial Literacy and Education Commission included in its introductory section concrete definitions for "financial literacy" and "financial education."

Recommendation: To help ensure that the National Strategy for Financial Literacy serves its goal of improving the nation's financial literacy and education, the Secretary of the Treasury, in concert with other agency representatives of the Financial Literacy and Education Commission, should incorporate into the national strategy a concrete definition for financial literacy and education to help define the scope of the Commission's work.

Agency Affected: Department of the Treasury

Status: Closed - Not Implemented

Comments: The Financial Literacy and Education Commission released a new strategy in 2011 and subsequently has produced an accompanying implementation plan (still in draft). The strategy and plan do not include the types of goals, performance and benchmarks that we recommended.

Recommendation: To help ensure that the National Strategy for Financial Literacy serves its goal of improving the nation's financial literacy and education, the Secretary of the Treasury, in concert with other agency representatives of the Financial Literacy and Education Commission, should incorporate into the national strategy clear, specific goals and performance measures that would serve as indicators of the nation's progress in improving financial literacy and benchmarks for what the Commission sets out to achieve.

Agency Affected: Department of the Treasury

Status: Closed - Not Implemented

Comments: The Financial Literacy and Education Commission released a new strategy in 2011 and subsequently has produced an accompanying implementation plan (still in draft). The strategy and plan do not include the types of concrete actions that we recommended that would achieve specific goals and benchmarks and make the documents true implementation plans.

Recommendation: To help ensure that the National Strategy for Financial Literacy serves its goal of improving the nation's financial literacy and education, the Secretary of the Treasury, in concert with other agency representatives of the Financial Literacy and Education Commission, should incorporate into the national strategy actions needed to accomplish these goals, so that the strategy serves as a true implementation plan.

Agency Affected: Department of the Treasury

Status: Closed - Not Implemented

Comments: The Financial Literacy and Education Commission released a new strategy in 2011 and subsequently has produced an accompanying implementation plan (still in draft). The strategy and plan do not include a description of the resources required to help allocate these resources or direct implementation of the strategy.

Recommendation: To help ensure that the National Strategy for Financial Literacy serves its goal of improving the nation's financial literacy and education, the Secretary of the Treasury, in concert with other agency representatives of the Financial Literacy and Education Commission, should incorporate into the national strategy a description of the resources required, which would help provide policymakers information on allocating resources and directing implementation of the strategy.

Agency Affected: Department of the Treasury

Status: Closed - Implemented

Comments: The Financial Literacy and Education Commission released a new national strategy in 2011. It also has produced an accompanying implementation plan, which is still in draft form and expected to be released publicly by the end of September 2011. The draft implementation plan incorporates a discussion of appropriate roles and responsibilities for federal agencies and others. For example, it outlines what actions are the responsibility of the Commission as a whole, its working groups, and federal agencies, respectively, and it encouraged roles as well for non-federal entities.

Recommendation: To help ensure that the National Strategy for Financial Literacy serves its goal of improving the nation's financial literacy and education, the Secretary of the Treasury, in concert with other agency representatives of the Financial Literacy and Education Commission, should incorporate into the national strategy a discussion of appropriate roles and responsibilities for federal agencies and others, to help promote a coordinated and efficient effort.

Agency Affected: Department of the Treasury

Status: Closed - Not Implemented

Comments: According to the Treasury Department, the MyMoney website was completely redesigned in 2009. Although a number of best practices were incorporated into that redesign, consumer usability testing was not among them and has not been conducted to date.

Recommendation: To ensure that the My Money Web site best serves consumers seeking financial education, the Secretary of the Treasury and other representatives of the Commission should provide for its Web site subcommittee to conduct usability testing to measure the quality of users' experiences with the Commission's Web site.

Agency Affected: Department of the Treasury

Status: Closed - Implemented

Comments: From mid-September through mid-December 2008, the Financial Literacy and Education Commission measured customer satisfaction of its MyMoney.gov Web site by using a Web-based survey accessible through a link on the site. The survey included questions about the characteristics of the user as well as the user's impressions, complaints, and suggestions about the site.

Recommendation: To ensure that the My Money Web site best serves consumers seeking financial education, the Secretary of the Treasury and other representatives of the Commission should provide for its Web site subcommittee to measure customer satisfaction with the site, using whatever tools deemed appropriate, such as online surveys, focus groups, and e-mail feedback forms.

Agency Affected: Department of the Treasury

Status: Closed - Implemented

Comments: In late 2008, the Treasury Department signed a volunteer service agreement with a doctoral student whose field of study includes program evaluation to collect, analyze, and report available data on the availability and duplication of financial education resources offered by federal agencies that are members of the Financial Literacy and Education Commission.

Recommendation: To help ensure the efficient use of federal resources, the Secretary of the Treasury, in conjunction with the Commission, should provide for an independent third party to carry out the review of duplication and overlap among federal financial literacy activities as well as the review of the availability, utilization, and impact of federal financial literacy materials.

Agency Affected: Department of the Treasury

Status: Closed - Implemented

Comments: In April 2007, the Financial Literacy and Education Commission established the National Financial Education Network, a network of state and local governments designed to communicate and collaborate on projects and ideas related to improving financial literacy. In January 2008, with the backing of the Treasury Department, the President created the President's Council on Financial Literacy, which consists of 16 members representing both nonprofit and private entities and tasked, in part, with working together with the public and private sectors to improve financial literacy.

Recommendation: To encourage effective and efficient use of scarce human and financial resources, the Secretary of the Treasury, in concert with other representatives of the Commission, should consider ways to expand upon current efforts to cultivate sustainable partnerships with nonprofit and private entities. As part of these efforts, the Commission should consider additional ways that federal agencies could coordinate their efforts with those of private organizations that have wide networks of resources at the community level. The Commission should also explore additional ways that the federal government might encourage and facilitate the efforts of state and local governments to improve financial literacy.

Comments: In April 2007, the Financial Literacy and Education Commission established the National Financial Education Network, a network of state and local governments designed to communicate and collaborate on projects and ideas related to improving financial literacy. In January 2008, with the backing of the Treasury Department, the President created the President's Council on Financial Literacy, which consists of 16 members representing both nonprofit and private entities and tasked, in part, with working together with the public and private sectors to improve financial literacy.

Recommendation: To encourage effective and efficient use of scarce human and financial resources, the Secretary of the Treasury, in concert with other representatives of the Commission, should consider ways to expand upon current efforts to cultivate sustainable partnerships with nonprofit and private entities. As part of these efforts, the Commission should consider additional ways that federal agencies could coordinate their efforts with those of private organizations that have wide networks of resources at the community level. The Commission should also explore additional ways that the federal government might encourage and facilitate the efforts of state and local governments to improve financial literacy.